Comments on: What if all this money we keep pumping into the banking system ultimately turns out not to be enough? http://www.secretfinance.com/blog/what-if-all-this-money-we-keep-pumping-into-the-banking-system-ultimately-turns-out-not-to-be-enough/ Thu, 17 May 2012 21:40:58 +0000 http://wordpress.org/?v=2.7 hourly 1 By: John K http://www.secretfinance.com/blog/what-if-all-this-money-we-keep-pumping-into-the-banking-system-ultimately-turns-out-not-to-be-enough/comment-page-1/#comment-2047 John K Fri, 07 Aug 2009 21:43:32 +0000 http://www.secretfinance.com/blog/what-if-all-this-money-we-keep-pumping-into-the-banking-system-ultimately-turns-out-not-to-be-enough/#comment-2047 Oh please! let me interject this analogy. Recently I was in Buffalo New York and read an article involving an elderly woman who lost $80,000 to a home improvement contractor. The contractor was like a freight train. Nothing would stop him, nothing would slow him down. He took the eighty grand over a short period of time. A total of seventy checks! Had the woman not said Enough is Enough the contractor would still be fleecing her. If we don't say No, No More, we'll have our pockets picked again too! The only difference between the contractor and the Congressional Bail-out are the sophistication and magnitude of the players. But then again almost all politicians have law degrees and swindle us with a little more finesse. Also worthy to note is the fact that the contractor went to jail while the Bail-out scam artists have not! Oh please! let me interject this analogy.

Recently I was in Buffalo New York and read an article involving an elderly woman who lost $80,000 to a home improvement contractor. The contractor was like a freight train. Nothing would stop him, nothing would slow him down. He took the eighty grand over a short period of time. A total of seventy checks! Had the woman not said Enough is Enough the contractor would still be fleecing her.

If we don’t say No, No More, we’ll have our pockets picked again too!

The only difference between the contractor and the Congressional Bail-out are the sophistication and magnitude of the players. But then again almost all politicians have law degrees and swindle us with a little more finesse.

Also worthy to note is the fact that the contractor went to jail while the Bail-out scam artists have not!

]]> By: runforfree http://www.secretfinance.com/blog/what-if-all-this-money-we-keep-pumping-into-the-banking-system-ultimately-turns-out-not-to-be-enough/comment-page-1/#comment-2046 runforfree Fri, 07 Aug 2009 13:54:58 +0000 http://www.secretfinance.com/blog/what-if-all-this-money-we-keep-pumping-into-the-banking-system-ultimately-turns-out-not-to-be-enough/#comment-2046 There is no upper limit. The banking system must be protected. Money is the oil that keeps the banking sector working efficciently. At the moment it is not working efficiently as it needs a cash injection. The money will in the most part be repaid once the system becomes lubricated with money. Bad debts as before will be written off from balance sheets. A more hightened regulatory framework though for the future is a must. I the long run I dont believe this is a form of nationalisation of banks as they will continue to run themselves. Governments may well make a tidy profit once the situation improves. There is no upper limit. The banking system must be protected. Money is the oil that keeps the banking sector working efficciently. At the moment it is not working efficiently as it needs a cash injection. The money will in the most part be repaid once the system becomes lubricated with money. Bad debts as before will be written off from balance sheets. A more hightened regulatory framework though for the future is a must. I the long run I dont believe this is a form of nationalisation of banks as they will continue to run themselves. Governments may well make a tidy profit once the situation improves.

]]> By: Jas B http://www.secretfinance.com/blog/what-if-all-this-money-we-keep-pumping-into-the-banking-system-ultimately-turns-out-not-to-be-enough/comment-page-1/#comment-2045 Jas B Tue, 04 Aug 2009 07:27:58 +0000 http://www.secretfinance.com/blog/what-if-all-this-money-we-keep-pumping-into-the-banking-system-ultimately-turns-out-not-to-be-enough/#comment-2045 A depression is what will happen on the scale which hit America and Europe in the 1920's and 30's with mass unemployment, a quarter of the workforce out of work, people evicted from homes and farms, huge numbers homeless and all the problems which come with that. In other countries the depression had even more profound effects. As world trade fell off, countries turned to nationalist economic policies that only exacerbated their difficulties. In politics the depression strengthened the extremes of right and left, helping Adolf HITLER to power in Germany and swelling left-wing movements in other European countries. The depression was thus a time of massive insecurity among peoples and governments, contributing to the tensions that produced World War II. It would effect the whole world with I suggest equally dire consequences are very likely to follow. A depression is what will happen on the scale which hit America and Europe in the 1920’s and 30’s with mass unemployment, a quarter of the workforce out of work, people evicted from homes and farms, huge numbers homeless and all the problems which come with that.

In other countries the depression had even more profound effects. As world trade fell off, countries turned to nationalist economic policies that only exacerbated their difficulties. In politics the depression strengthened the extremes of right and left, helping Adolf HITLER to power in Germany and swelling left-wing movements in other European countries. The depression was thus a time of massive insecurity among peoples and governments, contributing to the tensions that produced World War II.

It would effect the whole world with I suggest equally dire consequences are very likely to follow.

]]> By: rowlfe http://www.secretfinance.com/blog/what-if-all-this-money-we-keep-pumping-into-the-banking-system-ultimately-turns-out-not-to-be-enough/comment-page-1/#comment-2044 rowlfe Sun, 02 Aug 2009 11:12:03 +0000 http://www.secretfinance.com/blog/what-if-all-this-money-we-keep-pumping-into-the-banking-system-ultimately-turns-out-not-to-be-enough/#comment-2044 The problem with this bailout deal is that of risk, and who is holding the risk. The problem was started when bankers started loaning to people who were poor risks, and then turning around ans selling these loans as securities to others, treating the loan as an asset. Then, if the homeowner went into foreclosure, who exactly is it that loses? The one holding the paper, NOT the lender who made the original loan to a poor risk. Dubya and his minions are shifting the risk from the lending banks to the general public when he proposes buying the bad paper from the lenders and investment banks to keep them solvent. The people who wrote the bad paper lost nothing once they sold the debt, but anyone who bought the debt DOES. In effect, Dubya is turning the general public into a lending bank, taking ALL of the risk and repeating the mistake made in the first place. Simply buying the paper does NOT change whether the person who got the loan is a good risk or not. What was a poor risk originally is STILL a poor risk NOW! Simply changing ownership of a bad loan does NOT suddenly change the risk for the better! In effect, Dubya has taken a giant step toward nationalizing the banking system, which is a huge step toward a socialistic government and away from a democratic republic that we have NOW. I fail to see how shifting who has the risk, changes the risk. What irks me, is no one ASKED me if I am willing to become an investment banker and if I would accept the risk of a poor loan, HOPING the loan will be repaid so I get the money back... YMMV The problem with this bailout deal is that of risk, and who is holding the risk. The problem was started when bankers started loaning to people who were poor risks, and then turning around ans selling these loans as securities to others, treating the loan as an asset. Then, if the homeowner went into foreclosure, who exactly is it that loses? The one holding the paper, NOT the lender who made the original loan to a poor risk. Dubya and his minions are shifting the risk from the lending banks to the general public when he proposes buying the bad paper from the lenders and investment banks to keep them solvent. The people who wrote the bad paper lost nothing once they sold the debt, but anyone who bought the debt DOES. In effect, Dubya is turning the general public into a lending bank, taking ALL of the risk and repeating the mistake made in the first place. Simply buying the paper does NOT change whether the person who got the loan is a good risk or not. What was a poor risk originally is STILL a poor risk NOW! Simply changing ownership of a bad loan does NOT suddenly change the risk for the better! In effect, Dubya has taken a giant step toward nationalizing the banking system, which is a huge step toward a socialistic government and away from a democratic republic that we have NOW. I fail to see how shifting who has the risk, changes the risk. What irks me, is no one ASKED me if I am willing to become an investment banker and if I would accept the risk of a poor loan, HOPING the loan will be repaid so I get the money back… YMMV

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